The government can reduce unemployment or reduce inflation by:
A) manipulating aggregate demand.
B) manipulating the availability of natural resources.
C) manipulating the availability of capital goods.
D) manipulating the availability of qualified workers.
E) curbing the level of immigration.

Question

Quizplus · Accepted Answer

Manipulating aggregate demand, specifically through expansionary or contractionary fiscal or monetary policies, can have an impact on both unemployment and inflation. For example, an expansionary policy can boost demand, leading to an increase in employment, while a contractionary policy can decrease demand, leading to a decrease in inflation. The other choices, while they may have some impact on unemployment or inflation, are unlikely to be as effective or practical.

The Government Can Reduce Unemployment or Reduce Inflation By